Following a regulatory order in Germany from December forcing Facebook (NASDAQ:FB) to allow users to use pseudonyms (in direct conflict with its real-name policy), German courts have struck down the prior decision and sided with the social network. German privacy laws allow for Internet users to use nicknames and pseudonyms.
Administration courts had previously sided with Facebook in February, and today's decision further discredits the regulatory scrutiny. Since user data is not processed through Facebook's German subsidiary, which primarily conducts marketing and sales functions, it is not subject to the German privacy law. Facebook's European headquarters is in Ireland, making Irish law applicable.
Courts did not find that Irish law contained the same provision for pseudonym usage. Facebook frequently disables accounts for which real names are not used. As of the end of 2012, Facebook estimated that 7.2% of its total monthly average user base was composed of duplicates (5%), user-misclassified (1.3%), and undesirable (0.9%) accounts.
Fool contributor Evan Niu, CFA, has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Facebook. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
